N ew Start. New Management. New Era of Safe and Affordable Flying. After 2 years of negotiation, it has been achieved!

2. New Start. New Management. New Era of Safe and Affordable Flying. After 2 years of negotiation, it has been achieved!

3. Objectives • Establish a ‘not for profit’ airfield operating company unlike all of the previous lease holders. • Provide the ‘comfort’ required for the land owners of a responsible single point of contact, similar in their view to the existing arrangement with AOL Ltd. • Directors loan to settle AOL Ltd’s interest in the airfield and ensure essential maintenance is carried out. • Secure tenure of the airfield for the Staffordshire Aero Club and Flying School for the long foreseeable future. • Set user fees and hangar rent at a reasonable level to cover ongoing maintenance costs and generate sufficient surplus funds for investment. • Invest surplus funds in airfield facility improvements . • Enable the flying club to provide its members with the best airfield possible at the lowest cost possible. • To support the flying school. • Ensure everyone has a safe, affordable and happy aviation experience.

4. Management Structure • Staffordshire Aero Club Ltd • Board of directors • Peter Davis (MD), Graham Wiley (Co Sec), Jon Jordan, Mark Deeley, Bill Turner (non-Exec) • Staffordshire Aero Club • Committee • Chairman - Graham Wiley • Secretary - Simon Ganecki • Treasurer – Ken Seedhouse • Site & Safety Officer – Peter Davis • Events Officer – Jon Jordan • General member – Bill Turner • General member – Bob Arnold • Members.

5. Roles and Responsibilities • Staffordshire Aero Club Ltd – Board of Directors • Finance • Budgeting. • User fee and hangar rent collection. • Rent payment. Personally guarantee the lease. Personally guarantee the Section 106 Agreement • Maintenance . • Insurance . • Equipment and facility improvements. • Asset register. • SAC accord and tenancy agreement for hangar owners. • Communication. • Club committee, • Land owner, • Planning and other authorities. • Safety. • Ensure airfield users comply with ANOs, • Airfield operating procedures comply with CAA / EASA and other authorities recommendations and regulations. Personally answerable to the CAA and local Council. • Provision of safety equipment. • Security • Provision and maintenance of a visitors book for those that drive or walk in. • Security devices. • THE ‘BUCK STOPS’ WITH THE DIRECTORS!

6. Roles and Responsibilities • Directors • Make initial investment and agree new lease with land owners. • The solution requires an upfront payment to AOL and all the 2011 income. In addition Directors will provide sufficient funds for essential maintenance. • The existing lease will remain with AOL until expiry in 2012 when a new SAC Ltd Lease will take effect but will be executed immediately. The right to renew by AOL will be forfeited immediately • Directors expect to achieve a fair return on their investment from airfield income from 2012 onwards. No interest will be paid to Directors for their investment. • Share holding Directors will be offered a retainer of £625.00 per annum for their services (£12.00 per week). • Surplus Income from 2012 onwards will be used to provide a service to members and improve facilities . • Manage SAC Ltd • Take responsibility and consequent financial risk with immediate effect. • Receive no interest on their invested capital. • Allowed to claim reasonable expenses for costs incurred on company business, but not for leisure flying and casual visits to the airfield! • Must be members of Staffordshire Aero Club. • May be SAC committee members but not a requirement. • Directors are appointed by the SAC Ltd board.

7. Roles and Responsibilities • Staffordshire Aero Club - Committee • Membership. • Represent members. • Approve new members. • Arbitrate between members and management if required • Social. • Maintain social event budget. • Organise social events. • Fly ins • Fly outs • Club nights • Constitution. • Ensure members comply with club rules

8. Roles and Responsibilities • Committee Members • Elected annually in accordance with the SAC constitution. • Must be Staffordshire Aero Club Members for at least one year. • May be SAC Ltd directors but not a requirement. • Expected to work in conjunction with the SAC Ltd board of directors. • Represent the Staffordshire Aero Club members interests. • Carry out the offices they have been elected to, responsibly and to the best of their abilities.

9. Financial Model • AOL immediate payment of £21 K + all 2011 income • Directors loan expected to be £28 K • 4 shareholding directors at £7K each • Assuming income and expenses are as expected. (Directors loan repayment anticipated in 2013 ) • Income should generate a surplus fund for contingencies and greater investment from 2013 onwards. • The calculation takes into consideration 3 yearly increases in rent to the land owners.

10. Financial Model • Investment plans under consideration • Club / Airfield Sales and Marketing • Replace tractors and runway mowers • Electricity to Club house and School • Resurface access track • Telephone line to club house and school • On line weather station and web cam • Extension of Runway 11/29 • Additional hangars All when funds permit!

11. Section 106 Agreement • Local Authority has approved the following amendments: • Amend names to the current Land Owners. • Remove the word ‘micro’ to now read ‘Light Aircraft’ to cater for changes in aircraft designations (VLA, Light Sport etc) • Amend ‘one employed Instructor’ to ‘two contracted Instructors’ • Addition of SAC Ltd in a unilateral agreement

12. Questions

13. Questions • Q. Why do we need a management company? Why can’t the committee take on all the roles and responsibilities? • A. The landowners are not comfortable with dealing with a committee and therefore a structure is required to enable all parties to reach agreement. Land owners want a stable business relationship. The committee could change on an annual basis. Staffordshire Aero Club Ltd will provide a consistent approach to financial , legal and regulatory matters. The landowners are more than comfortable with our our suggested structure and to the parties who have taken on the responsibility as Directors. A ‘Committee’ cannot guarantee the lease or the responsibility of the Section 106 Agreement. • Q. Why have not all member been asked if they want to be on the board of directors? • A. It was considered more than 4 or 5 people on the board would be unmanageable. The land owner only wanted one person but has compromised. Certain members were asked based on their business experience, knowledge of airfield operations and ability to make a significant long term investment together with their acceptance of the personal legal responsibilities required. As soon as 4 such individuals who met the criteria had agreed to the terms, we had to progress with the project and seek approval from the land owners. • Q. Will directors money be paid into a company bank account then to AOL once cleared? • A. The transaction will be like selling a house. New post dated lease will be effective on the same date as the old lease is cancelled/forfeited. The financial transaction from the SAC ltd bank account to the AOL account will be at the same time. • Q. What rules will govern the appointment of board members? • A. Directors will have to be SAC members, and meet normal criteria. Shareholders will vote.

14. Questions • Q. How can Directors be removed if they act against the company / clubs best interests. • A. Shareholders vote and in accordance with the Memorandum and Articles of Association and the Directors/shareholders Agreement. • Q. What risks legal and financial do directors face? • A. Can be prosecuted and fined for failure to prepare accounts or other documents on time. Prosecuted, fined and/ or imprisoned for failure to comply with heath and safety regulations. There is no limit to personal liability of directors or officers. Personally guarantee the lease and the S 106 Agreement. • Q. Will each director require insurance, eg: personal indemnity, directors liability? • A. Yes • Q. Will insurance costs be paid by SAC ltd? • A. Yes • Q. If a Director decides to resign before loan is repaid will repayments to him/her still continue? • A. Yes, until his/her interest is settled.

15. Questions • Q. Can a share holding Director sell his share to another? • A. Yes but the number of shares any one Director can hold must be limited with no majority shareholders. • Q. What rules will govern this?What happens if share holder dies? • A. The percentage shareholding of any one director will be exactly proportional to 100% of the authorised and issued shares divided by the number of directors . If a share holder dies their shares will be divided equally between other shareholders or passed to a suitable replacement, if acceptable to the remaining Directors. • Q. What are the tax implications for SAC Ltd Directors? • A. SAC Ltd will not make any profit so Directors cannot be paid dividends. Tax will only be payable by an employee of the company receiving remuneration. • Q. Will SAC Ltd have to be VAT registered? • A. No as long as the turnover remains less than £70K. May still be exempt if HMRC agree that the company is a recreation or hobby. • Q. Can surplus income be classed as profit? • A. It can be classed as retained earnings if reinvested in the company. Or paid as dividends to shareholders.

16. Questions • Q. How long will the new lease be for? • A. To be agreed. Ideally 10 years. • Q. S106 requires changes and SAC Ltd will have to maintain future compliance. • A. SAC Ltd and the Land owners will work together to update the S106 agreement which has been agreed ‘in principle’ by the authorities. SAC Ltd will have to enter into a ‘joint and several’ unilateral undertaking with the landowners. • Q. Will all members be given a new contract, similar to the accord?Should this be a signed commitment to pay on time?In return should there be a tenants agreement for hangar owners? • A. Yes. Existing accord to be reviewed and tenants agreement to be drafted.